Credit Reference Letter

Credit reference letters are given by the bank as an assurance of honesty for both buyer and the seller. This letter declares the credit worthiness of the party you are willing to do trade with. Often while doing trade for the first time with someone, we are in doubt whether to trust the person or not. Especially in the case of credit sale. That is when this letter is useful.

A credit reference letter is a formal letter and is written with great professionalism to customer. Both the selling party and purchasing party have to accept the terms and conditions given in the letter of credit. The bank acts as a go-between the selling and purchasing party through issuing credit letter. The letter has documents attached with it to prove the creditworthiness of the person. Once through the letter, check for grammatical errors. If you still don’t know how to write a credit reference letter, feel free to use the tips and samples provided below.

Credit Reference Letter Writing

Write the purpose of the letter clearly. Write that you are writing this letter as a guarantee for someone and requesting the bank to give the financial support.

Mention all the details, what is your relationship with the person asking for the financial support, what is his purpose to take the loan etc. Also, mention about your goodwill with the bank.

Write this letter in professional language, yet the tone must be friendly. This can be written informally.

Ensure that there are no grammatical mistakes in the letter.

Credit Reference Letter Template

Use our free Credit Reference Letter to help you get started.

From,

_____________

_____________

Date : ___________ (on which the letter is written)

To,

____________

____________

Subject – Credit Reference

Dear _____(sir/madam),

I am writing this letter to guarantee you about my brother who is in need for some working capital from your bank to start his own business. I ____ (your name) the proprietor of _____ (name of the company), own a current account with your bank for last ___ years (mention the no. of years) and have also maintained a good reputation in your bank. You can take my reference as a guarantee for him. I assure you that he will follow the terms and conditions stated by you and he will pay back the amount in time.

Thanking you

_________ (name)

Sample Letter

The following is the sample of Credit Reference Letter.

From,

Sejal Roy

M/s J.K Industries

New Delhi

Date: 10th May 2010

To,

Manager

Delta Bank

New Delhi

Subject – Credit Reference

Dear Sir/ Madam

I am the undersigned Mr. Roy, the proprietor of M/s J.K Industries. I have a current account with your bank for last nine years, and I have maintained a nice transaction record to date. I receive good treatment from your staff, every time I am at the bank. I am very glad to know that your bank gives back up to the new upcoming entrepreneurs willing to start their own business. But for this matter, some kind of reference or guarantee is essential. My brother is willing to begin his own business of machinery and tools, but he needs some capital to be invested in the business. He had come to your bank for the financial support, where he came to know that he is required to give reference of a current bank member. I can assure you on his behalf and take his guarantee that he will repay the credit amount promptly and according to the rules given by you. I can give my reference for his repayment.

Thanking You.

Yours sincerely,

Sejal Roy

Email Format

The following is the email format of credit reference letter.

To: name@email.com From: name@email.com

Subject – Credit Reference

Dear _____ (sir/madam),

I am writing this letter to guarantee you about my brother who is in need for some working capital from your bank to start his own business. I ____ (your name) the proprietor of _____ (name of the company), own a current account with your bank for last ___ years (mention the no. of years) and have also maintained a good reputation in your bank. You can take my reference as a guarantee for him. I assure you that he will follow the terms and conditions stated by you and he will pay back the amount in time.